ABC Division Is in the United States with High Income

question 69

Multiple Choice

ABC Division is in the United States with high income tax rates.ABC Division produces a component for the Spain Division in a low income-tax-rate country.What transfer price should ABC Division set for the component sold to the Spain Division to minimize taxes?

• A) ABC Division should set a high transfer price to maximize profits.
• B) ABC Division should set a low transfer price to maximize profits.
• C) ABC Division should set a high transfer price to minimize taxes.
• D) ABC Division should set a low transfer price to minimize taxes.

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Definitions:

Southern Evangelicals

A demographic group in the Southern United States characterized by their strong evangelical Christian faith and its influence on their social and political views.

Slavery

A system in which individuals are owned by others, deprived of personal freedom, and forced to perform labor without compensation.

Christianity

A monotheistic religion based on the life and teachings of Jesus Christ, with numerous denominations worldwide.

Black Slaves

Individuals of African descent who were forcibly transported to and enslaved in various parts of the world, particularly in the Americas, from the 16th to the 19th centuries.